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    SmartBrief enables case brief popups that define Key Terms, Doctrines, Acts, Statutes, Amendments and Treatises used in this case.

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    Civil Procedure Keyed to Field

    In re Boise Cascade Securities Litigation

    Citation:

    420 F. Supp. 99 (W.D. Wash. 1976)

    Facts

    In November 1969, Boise Cascade Corporation acquired West Tacoma Newsprint Co., with shareholders receiving Boise stock valued at approximately $75 per share. In 1971-1972, Boise was forced to write down assets by approximately $200 million for various reasons, causing the stock price to plummet to approximately $12 per share. Former Newsprint shareholders and others filed multiple civil actions alleging violations of federal and state securities laws based on alleged misrepresentations and omissions in Boise’s financial statements. The complaints alleged numerous complex accounting improprieties including: improper tax accounting creating $5 million in undisclosed liabilities; failure to disclose $20 million in performance bond guarantees for Burnett-Boise subsidiaries (ultimately resulting in $40 million losses); failure to consolidate Burnett-Boise accounts despite actual control; improper accounting for recreational land sales including inadequate bad debt reserves, failure to establish discount reserves, improper revenue recognition on minimal down payments, unrealistic cost estimates, improper allocation of land costs, and artificial inflation of repossessed land values; failure to disclose fraudulent land sales practices that exposed Boise to substantial civil liability; and concealment of quarterly adjustments through merger pooling. The cases were consolidated for pretrial proceedings, with over 50,000 lawyer hours expended and over 900,000 documents produced. Trial was estimated to require four to six months.

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    In re Boise Cascade Securities Litigation